Correlation Between Willy Food and Rapac Communication
Can any of the company-specific risk be diversified away by investing in both Willy Food and Rapac Communication at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Willy Food and Rapac Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Willy Food and Rapac Communication Infrastructure, you can compare the effects of market volatilities on Willy Food and Rapac Communication and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Willy Food with a short position of Rapac Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Willy Food and Rapac Communication.
Diversification Opportunities for Willy Food and Rapac Communication
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Willy and Rapac is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Willy Food and Rapac Communication Infrastruc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rapac Communication and Willy Food is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Willy Food are associated (or correlated) with Rapac Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rapac Communication has no effect on the direction of Willy Food i.e., Willy Food and Rapac Communication go up and down completely randomly.
Pair Corralation between Willy Food and Rapac Communication
Assuming the 90 days trading horizon Willy Food is expected to generate 1.63 times more return on investment than Rapac Communication. However, Willy Food is 1.63 times more volatile than Rapac Communication Infrastructure. It trades about 0.51 of its potential returns per unit of risk. Rapac Communication Infrastructure is currently generating about 0.3 per unit of risk. If you would invest 197,200 in Willy Food on September 13, 2024 and sell it today you would earn a total of 63,800 from holding Willy Food or generate 32.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Willy Food vs. Rapac Communication Infrastruc
Performance |
| Timeline |
| Willy Food |
| Rapac Communication |
Willy Food and Rapac Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Willy Food and Rapac Communication
The main advantage of trading using opposite Willy Food and Rapac Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Willy Food position performs unexpectedly, Rapac Communication can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Rapac Communication will offset losses from the drop in Rapac Communication's long position.| Willy Food vs. Rami Levi | Willy Food vs. Neto ME Holdings | Willy Food vs. Shufersal | Willy Food vs. Strauss Group |
| Rapac Communication vs. Aran Research and | Rapac Communication vs. Al Bad Massuot Yitzhak | Rapac Communication vs. Analyst IMS Investment | Rapac Communication vs. Golan Plastic |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the CEOs Directory module to screen CEOs from public companies around the world.
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